Policy Research Reports
The Socioeconomic Impact of the Russia-Ukraine Crisis on Vulnerable Families and Children in Egypt: Mitigating Food Security and Nutrition Concerns
No.
PRR 46
Publisher
ERF
Date
June, 2023
Russia’s invasion of Ukraine in February 2022 added fuel to the fire for a global economy already suffering from the COVID- 19 pandemic’s slowdown of the global flow of commodities and the disruption of supply chains (Santacreu and LaBelle, 2022).
While the Russia-Ukraine crisis has left its mark on the world economy as inflation rates rise and debts increase, its negative impacts have been even more pronounced for low- and middle-income countries. This report highlights the severe consequences of the crisis on food security in Egypt and the likelihood that it will lead to higher risks of child malnutrition.
Egypt has historically had strong economic ties and deep-seated trading relationships with both Russia and Ukraine. Due to its vulnerable economic position – with low foreign exchange reserves, high interest payments, quickly rising inflation rates and an unstable tourism sector – Egypt’s economic struggles are expected to worsen with the continuation of the crisis. The economic impact of the crisis has affected already high inflation rates, imports of wheat and other necessary products, and resulted in the dwindling influx of tourists that traveled to Egypt from Russia and Ukraine.
Furthermore, the threat of food insecurity is particularly noticeable as Egypt is highly dependent on food imports. In the five years before the crisis, Egypt sourced an average of approximately 85% of its wheat imports from Ukraine and Russia (UN Comtrade, in: Abay et al, 2022). As the main ingredient of traditional Egyptian Baladi bread, which households rely heavily on for their daily food consumption, wheat is an important and strategic crop.
In addition, the global increase in food prices and the frequent rise in domestic inflation have raised concerns about food security among the country’s most vulnerable households. Shortly after the crisis began, in March 2022, the inflation rate in Egypt increased to 12.1% compared with March 2021. The rate continued to escalate, reaching a peak of 15.3% in May 2022. After the devaluation of the Egyptian pound in late October 2022, the rate again rose, reaching 21.9% by December 2022.
The number of poor households increases when inflation rates rise, especially when net incomes remain stagnant or increase at lower rates. The rise in poverty rates usually implies a decrease in spending on, and consumption of, essential food and non-food items, which is indicative of food insecurity.
During previous economic crises, vulnerable households in Egypt frequently resorted to reducing food consumption to cope with financial difficulties (CAPMAS, 2020a, 2020b, 2022a). The inflation of food prices, and the resulting reductions in food consumption, are difficult for children of poor households, leading to malnutrition and affecting physical and cognitive development. Based on previous data, the rising inflation rates caused by the crisis are likely to lead to changes in food consumption patterns.
Escalations in inflation rates from January 2022 to December 2022 mostly affected the prices of bread and cereal, which increased by 58.3%. The prices of milk, cheese and eggs also increased by 48.9% in December 2022. These ingredients are crucial for children’s growth. According to a 2022 telephone survey (CAPMAS , 2022a), food price increases led 74% of households to limit their food consumption, 93% to reduce their protein consumption, and about two-thirds of households to reduce their consumption of eggs, vegetables, and fruits.
Given that more than 92% of poor households in Egypt have children (HIECS 2019), declines in food consumption are likely to affect child nutrition, and increase the risk of food insecurity for children. While government protection programs such as Takaful and Karama Program (TKP), food subsidies, and the National School Feeding Program (NSFP) have had a major impact on protecting and supporting children in vulnerable households, there is a need for additional interventions in the short to medium term.
In the short term, officials should ensure that TKP benefits reach extremely poor households, especially those with children. Officials should expand school meal programmes to ensure that more vulnerable children receive the nutrition they need for healthy growth.
Concerned government officials can also develop a child-focused, national, multisectoral action plan to prevent a rise in malnutrition rates. It is important to diversify sources of wheat imports while considering wheat alternatives for affordable staple foods. In addition, experts can implement social behavior change interventions to promote a diversified diet and the consumption of locally available nutritious foods to replace wheat.
In the medium term, social protection programmes such as the TKP, school meals and the ration card system need to be evaluated and developed to reach broader segments of the population. Additionally, each stage of the bread supply chain needs to be effectively managed to reduce food waste. Finally, Egypt would benefit tremendously from investing in more food fortification programmes.
Download the Arabic version of the report
Research Fellows
May Gadallah
Associate Professor, Departments of Statistics, Cairo University
Speakers
Nesma Mamdouh Amer
Senior Statistician, Economic Research Forum